Dan Martell - May 01, 2017


How To Increase The Amount of Repeat Business


Episode Stats


Length

7 minutes

Words per minute

216.35214

Word count

1,563

Sentence count

81


Summary

Summaries generated with gmurro/bart-large-finetuned-filtered-spotify-podcast-summ .

How do you increase the number of repeat customers in your business? How do you get more than one customer at a time and keep them as long-term customers? In this episode, I talk about how you can increase the churn of your business to keep them coming back.

Transcript

Transcript generated with Whisper (turbo).
00:00:00.000 Mario Kart.
00:00:01.440 Oh, man.
00:00:02.540 Oh, years.
00:00:03.960 I used to play Mario Kart, listen to...
00:00:07.000 It wasn't Nine Inch Nails, it was another one.
00:00:18.880 How do you increase the number of repeat customers?
00:00:22.700 That's what we're covering today.
00:00:24.360 You know, for me, I see these entrepreneurs
00:00:26.580 and they're frustrated because they've got
00:00:28.560 a lot of turnover in their business, right?
00:00:30.700 And when I asked them, I was like,
00:00:31.700 what's the lifetime value of their business?
00:00:32.980 They're like, oh, I don't want to talk about it.
00:00:34.180 It's like, why are you always doing new projects?
00:00:37.680 Why aren't you actually sitting down and saying,
00:00:39.160 okay, what can we do as a company, product or service,
00:00:41.920 to make sure that we have new opportunities
00:00:44.580 with our existing customers?
00:00:46.020 Because at the end of the day, here's what I've learned.
00:00:48.380 The purpose of a business is to create,
00:00:50.640 and here's the magic word, keep a customer, right?
00:00:54.020 And if you do it right, you have these long-term customers.
00:00:56.780 It allows you to plan better.
00:00:58.560 You have less challenges always trying to find new customers.
00:01:02.740 I really had to learn this lesson the hard way
00:01:04.440 when we were building my company Flowtown.
00:01:06.200 It was a social marketing application for small businesses.
00:01:09.900 And I remember we sat down and we looked at a thing
00:01:11.640 called the churn, right?
00:01:13.280 Those of you guys out there know, it's like,
00:01:14.640 churn is the most important number in building software.
00:01:17.420 And I'm looking at it and I remember calculating it
00:01:19.820 with my co-founder, I'm like, we have a 20% churn.
00:01:23.260 And he's like, is that good or bad?
00:01:24.720 And I said, well, here's a way to think about it.
00:01:26.360 With a 20% monthly churn, every five months
00:01:30.140 we lose all our customers.
00:01:31.960 He's like, that does not sound like a good business.
00:01:34.700 And I was like, I know, I was like,
00:01:36.740 on average a company should be at like
00:01:38.780 eight to 10% churn per year.
00:01:41.240 So we had to figure out how to change that
00:01:43.640 in fast and pronto, so that's what
00:01:45.480 I wanna share with you guys is a process
00:01:47.040 of how to think about it, and this applies to software,
00:01:49.280 service businesses, other types of companies,
00:01:51.760 to really think of how can you approach your customers
00:01:53.920 in a way that'll create repeat business.
00:01:56.620 Now, number one is you gotta offer an ongoing service.
00:02:00.000 You know, and I've seen this true for, you know,
00:02:02.700 agencies that do kind of one and done projects.
00:02:05.300 They don't think about what's the ongoing service
00:02:07.660 after the fact.
00:02:08.500 Maybe it's website maintenance, maybe it's whatever.
00:02:10.940 I mean, just this morning I had the guy
00:02:13.080 that manages my air filter.
00:02:15.100 He has a computer system that monitors all his customers.
00:02:17.540 He's like, hey, do you want us to change your air filter?
00:02:19.580 I was like, does it need to be changed?
00:02:20.640 He's like, yeah, it does.
00:02:21.480 And I'm like, cool.
00:02:22.320 He goes, well, we actually have a service plan.
00:02:23.920 I'm like, you have a service plan.
00:02:25.600 Do you tell me about your plan?
00:02:27.880 He's like, well, and it's three or something,
00:02:30.100 whatever bucks a year,
00:02:31.600 and we'll come every three months and we'll change it.
00:02:33.260 And I'm just like, you know what, sign me up.
00:02:35.160 He got me with the ongoing service
00:02:37.600 for somebody that installed my furnace.
00:02:39.780 That, I mean, everybody watching this
00:02:42.000 has an opportunity to think about
00:02:43.340 what's something that I could offer my customers.
00:02:46.620 And could it be something you're not even offering
00:02:48.320 that you have to do yourself,
00:02:49.600 but you can offer it to get a residual
00:02:51.160 to build that ongoing revenue?
00:02:53.700 Number two, I want you to start strong, okay?
00:02:56.980 What I mean by that is onboarding a new customer.
00:02:59.640 When you start with somebody, you wanna make sure that
00:03:01.600 experience of them getting started with your business is
00:03:04.720 awesome, that it's clear expectations, and here's what
00:03:08.100 you can expect, and making sure that they get the value as
00:03:10.840 fast as possible, right?
00:03:12.420 You have a core value in your business.
00:03:14.280 You have a customer who just signed up.
00:03:15.700 How fast can you get them to experience that core value?
00:03:19.880 Because that'll allow them to think about, like, man, these
00:03:22.460 people really know how to operate their business.
00:03:24.120 That was one of the first things we did in our company
00:03:26.300 to improve the churn numbers to make sure that our
00:03:27.900 activation rate, which is that, core value to customer,
00:03:31.460 was high.
00:03:32.400 Number three that you need to do is you gotta continue
00:03:34.940 adding value.
00:03:36.140 Some people, they think, well, I got a customer,
00:03:37.800 and they're good, and they're on the service,
00:03:39.040 and I don't need to talk to them.
00:03:40.780 That's crazy.
00:03:42.580 You need to ask yourself this question.
00:03:44.240 If you wanna grow your business, and this is not even
00:03:45.860 just about continuously adding value, you need to ask yourself
00:03:48.920 is how can I create more value for my customer than anybody
00:03:52.460 else in the world, any competitor, how do I do that?
00:03:56.000 Answering that question, especially implementing it
00:03:58.740 for your customers, is how you're gonna win this game.
00:04:02.200 Number four is end strong.
00:04:05.240 So even if there is an ending to the project,
00:04:07.540 and I'm gonna teach you what to do next,
00:04:09.440 you wanna make sure you end on the best note possible.
00:04:11.740 It means you wanna give them a report.
00:04:13.140 You wanna show them the value they've received.
00:04:14.820 You wanna make sure that they understand what went on.
00:04:17.860 Because there's this thing called the primacy
00:04:19.420 and recency bias, right?
00:04:20.920 It's why we always remember the first, second, and third
00:04:23.720 out of the list of three is the primacy is the first thing,
00:04:27.180 right, and that's why I say start strong.
00:04:28.780 Build your onboarding experience for your new customer.
00:04:31.320 Then end strong, which is a primacy because they're going to
00:04:33.460 only remember the beginning and the end.
00:04:36.120 Sure, there might be some challenges in the middle,
00:04:38.120 but typically that is their experience when they think to
00:04:40.520 themselves, how was it working with that company?
00:04:42.380 They're going to look at those two points.
00:04:43.640 So ending strong, making sure that they're happy.
00:04:46.360 Most customers or companies don't even think about this for
00:04:49.500 for their customers, and I think it is everything
00:04:51.940 because that bias exists at a human and psychological level.
00:04:55.380 The recency, primacy bias, go check it out,
00:04:57.840 so you wanna end strong, and then finally, number five,
00:05:01.340 you wanna make sure that you ask for more business.
00:05:03.880 You know, the funniest thing I see all the time
00:05:07.020 with companies is they've never actually gone back
00:05:09.560 to previous customers and asked them for more business.
00:05:11.780 They've never said, okay, once a quarter,
00:05:13.320 we're gonna reach out, we're gonna do it via video.
00:05:15.360 If you wanna watch my video on video re-engagement
00:05:17.860 on my YouTube channel, go check that out.
00:05:20.360 They don't think about like, how do I connect
00:05:23.200 and create value for them even after they're a customer
00:05:26.560 so that you can ask for the business?
00:05:30.440 Because that's, it's called TOMA, top of mind awareness.
00:05:33.940 In your market, when they think of the problem they're having
00:05:36.620 and you as a company could solve it,
00:05:38.380 they either think of you or they don't.
00:05:40.080 And that's what you want for every past customer
00:05:42.780 is to say, oh, I need a new design,
00:05:44.120 I gotta reach out to this agency.
00:05:45.520 I need to amplify my analytics or reporting
00:05:48.040 when I use this software.
00:05:49.160 Whatever it is, that's your opportunity.
00:05:51.380 You've got to ask for the business.
00:05:52.120 Now, finally, this is Ninja.
00:05:54.480 You want to know the number one tip
00:05:55.580 to make all of this magical is ask for a testimonial
00:05:59.540 and or, and this is what I do, is a case study
00:06:02.580 or essentially an interview that can act
00:06:05.600 as a testimonial and a case study.
00:06:07.140 And there's a really easy way to do it
00:06:08.400 using Skype or in person.
00:06:10.160 Grab a camera and just be like,
00:06:12.060 hey, what was your life before?
00:06:13.900 How did it work out?
00:06:15.020 What were the results?
00:06:16.480 What would you tell somebody that's sitting on the fence?
00:06:18.260 That's a quick level format for doing very easy case studies.
00:06:21.760 Companies like Airbnb pretty much built their business
00:06:25.260 on their host case studies.
00:06:26.860 If you go on, check that out.
00:06:28.060 I think that's an opportunity for everybody.
00:06:29.900 If you do everything else right and the customer doesn't
00:06:32.580 decide to do more work with you, who cares?
00:06:35.040 Get, well, who cares?
00:06:36.200 That's bad.
00:06:37.140 But get the case study, get the testimonials so that you can
00:06:40.640 make sure that other companies like that company see that
00:06:44.180 you've done work for them, that's your opportunity.
00:06:46.380 So what I want to ask you below is what are you going to do
00:06:48.580 to change all this?
00:06:49.780 What are you going to do to make sure you get repeat customers?
00:06:52.180 Answer that question below in the comments.
00:06:53.980 I'll be sure to answer every one of them.
00:06:56.080 As per usual, I want to challenge you to live a bigger life
00:06:58.280 and a bigger business.
00:06:59.580 I'll see you next Monday. Cheers.
00:07:01.180 If you like this video, be sure to subscribe to my channel.
00:07:03.480 I'd also invite you to join my newsletter where I share
00:07:05.780 exclusive invites to private events and also free training
00:07:09.580 videos and if you're ready to get going, I've got two playlists
00:07:12.380 cued up, ready for you.